Where’s my mining boom!!!

The mining tax has become a major issue over the past week since it was revealed that it had generated far less revenue than the government and the community originally anticipated in it’s first six months of operation.

At first glance, this issue might seem like a political minefield for the ALP as it plays into classic Liberal Party frames in relation to the ALP being wealth redistrubtors, the party that punishes success and so on.

The reality as you’re about to see is very much the opposite.

The mining tax has overwhelming support in the community and the general consensus is the miners and the mining industry aren’t contributing enough to the overall well being of the Australian economy and society in general. There are of course economic reasons for this dynamic such as the dramatic rise in the price of iron ore over the past decade and China’s intense demand for Australian resources to facilitate their rapidly growing economy.

What I’m going to focus on with this post is how it plays out in the realm of public opinion and the national political debate.

“In your opinion, who do you think is more responsible for Australia’s strong economy? The Gillard government, or the mining industry?”

The results were:

The Gillard Government: 28%

The Mining Industry: 69%

Don’t Know 8%

Given the IPA’s close ties to mining magnate Gina Rinehart and the Liberal Party of Australia, it’s fair to assume that they commissioned this poll and released it in order to humiliate the federal government. That doesn’t mean we should treat this poll with any more or less suspicion than any other poll.

Far from it!

I interpret these results a bit differently than they obviously do (if they saw it my way, I’m not sure they’d have released it). I think the public feels hostage to the mining industry and they want the government to act on their behalf! …

Moving right along!

Next, we’ll look at Essential Media’s polling on public opinion to both mining as an industry and the mining tax as a policy.

From the results above, we can see that mining is near the bottom of trusted industries in Australia only ahead of the media and power companies. This alone is quite telling. Let’s look deeper at the public’s opinion in regards to the actual policy. Again from Essential Media:

The Minerals Resource Rent Tax (MRRT) – a tax on large profits of mining companies

63%

22%

The carbon pricing scheme – a tax on industries based on the amount of carbon pollution they emit

46%

44%

If we break that down even further into intensities of response we get:

Strongly support

Support

Oppose

Strongly oppose

Don’t know

25%

38%

12%

10%

15%

It’s pretty clear when you see these results that the Australian public overwhelmingly support the mining tax. When you consider the IPA commissioned Galaxy Poll that shows Australian’s consider the mining industry as responsible for the country’s strong economy, it’s not hard to understand why this is the case. The mining industry is powerful and they need to be held accountable for the public’s economic well-being through the public’s elected representatives: the government.

Based on the results above, it’s pretty evident that the Australian public doesn’t seem to have a lot of sympathy for the mining industry. The point is made emphatically when you see results that show 37% of respondents believe mining companies don’t pay enough tax!

Lets see what polling conducted by other organisations and institutions tells us.

Fast forward to April 2012 and AC Nielsen conducted a poll for the Australian Financial Review that showed only 12% of respondents felt they had personally benefited “a lot” from the mining boom. By contrast 33% of respondents felt they had benefited “a little” and an overwhelming 52% of respondents felt they “had not benefited at all.”

To make the point even more emphatic: in Western Australia, where you’d expect to see most of the benefit from the mining boom due to the incredible amount of mining investment and projects being implemented in the state, 23% of respondents felt they’ve benefited a lot compared to 35% who felt they’d benefited a little and 41% who felt they haven’t benefited at all! … In Western Australia! … The state that constantly threatens to secede because they’re doing the “hard work” for the rest of the country and overflowing with mining riches!

I think that’s enough polling data for you to get the picture of how the mining industry, mining companies and the mining tax are viewed by the Australian public.

What all of this tells us is there is a feeling that the mining industry is responsible for the economic success of Australia, yet at the same time it’s very clear that an overwhelming majority of people are feeling and thinking that something needs to be done to take advantage of the boom and they’re viewing the mining tax as a favourable policy response.

So when the mining companies and the lobbying firms produce advertisements like the one’s below, all they do is reinforce the view that they’re not doing enough for Australia and the public demand more from them and their government to make things right.

The results in terms of public opinion are pretty much the opposite of what we all think the mining industry wants which is to pay as little tax as possible and in some rare cases the diabolically ingenious idea of paying “less than” nothing.

With all of that firmly in place, what happens when the public hear that the mining companies spent $22 million on an advertising campaign in 2010 to roll a Prime Minister who was trying to look after the Australian people’s interests?

How do you think the public feel when they see mining companies (especially extremely large foreign mining companies) and the mining industry as a group attempting to avoid paying the mining tax by any means necessary and earning themselves hundreds of billions of dollars in profit over the next decade at the Australian people’s expense?

How do you think the public feel when they hear that the government’s policy to deal with this issue of securing Australia’s future prosperity after the mining boom ends only raised a mere $126 million in revenue in it’s first six months of it’s operation, not even scratching the surface of the $2 Billion in revenue the tax is meant to generate for this financial year?

How do you think the public feel when they see television, radio, and full page magazine advertisements such as the three I’ve posted above from companies and lobbyists on behalf of the mining industry that appear to have unlimited money and political power and a larger voice in the “democratic” process than the average person?

Correct. However, my point wasn’t about the design of the policy. It had to do with public opinion in relation to the issue. I’d say people are very dissatisfied with how the policy has been delivered (and rightly so)

[…] despite the failures of Government, the tax remains extraordinarily popular amongst the voting public. A fact that shows that arguments for its continued existence and further refinement remain, for […]

[…] despite the failures of Government, the tax remains extraordinarily popular amongst the voting public. A fact that shows that arguments for its continued existence and further refinement remain, for […]